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The argument is that the sanctions authority granted by Congress to Treasury is limited to persons and entities, and the Tornado Cash smart contracts are neithe

The argument is that the sanctions authority granted by Congress to Treasury is limited to persons and entities, and the Tornado Cash smart contracts are neither, nor the property of either.

woodruffw 4y ago
I think my response to 'yieldcrv addresses this. TL;DR: Nobody thinks that the Tornado Cash smart contracts are themselves persons. The government is clearly operating along the reasoning that a human being had to be (and was, in fact) in the loop as part of deploying the smart contracts. That brings us back to the initial analogy I used: you can't absolve yourself by building a robot that does the crime for you.
- miracle2k 4y ago
  > you can't absolve yourself by building a robot that does the crime for you. But the argument isn't at all about absolving the robot builder. In fact, they explicitly take no view on whether the sanctions against the Tornado Cash entity are justified. They also do not take a view on whether the government would be justified in prosecuting the individuals behind Tornado Cash. They are saying the government does not have the statutory authority to sanction the robot you built.
  - woodruffw 4y ago
    That's not what they're saying. They're saying the government doesn't have the statutory authority to sanction the entity that built the robot. This is the entire point of their extended digression on the "Tornado Cash Entity" versus the "Tornado Cash Application." (Defending the TCE also continues below that, on a mostly irrelevant and unargued tangent about software IP.)
    - miracle2k 4y ago
      From the post: "So there is potentially an entity called Tornado Cash that is controlled by certain individuals, and the web address and some of the Ethereum addresses in the notice can be thought of as either pseudonyms for that entity or, alternatively, as its property. At this point, we’re not offering an opinion on whether it was appropriate to sanction that entity—we do not know all the facts that have led to this action—but we would agree that there may be an entity behind those donation addresses and that said entity may be legally eligible for listing. "
      - woodruffw 4y ago
        Yeah, I read that. The problem is that it just isn't compatible with the rest of the post: there are extended sections where they point out that the TCE can't be held responsible for the TCA, that even an IP-based case against the TCE would not apply, etc. etc. In short: they're trying to have it both ways, and it's not coming off well. If they had restricted their attention to just the TCA the argument would be more interesting, but ultimately still not compelling: everybody involved understands that there were some humans who decided to "pull the trigger" and deploy the TCA.
smsm42 4y ago
That's just playing semantic games. Like saying "well, the police only has authority over people, and a person didn't kill him - a bullet shot from a gun did!". Somebody was on the back end of that gun, and somebody deployed Tornado Cash. And the police can confiscate the gun and the bullets, and prosecute whoever shot it. The autonomous part here does not solve anything - it's only work if the whole system, ab initio, was autonomous without human intention - but even then the government could claim to regulate an access to it - just as it could, for example, restrict access to an erupting volcano if it wanted, even if no person caused it to erupt. But here it's much simpler because somebody definitely caused TC to operate, so the whole argument disappears.
- woodruffw 4y ago
  I just want to say: you beat me to using the bullet analogy! If you don't mind, I intend to link to this comment in a blog post.
- notch656a 4y ago
  The people that 'shot' the bullet though are either the node operators or the users of Tornado Cash. Interestingly the node operators (the people ACTUALLY EXECUTING TC, even at this very moment) haven't been sanctioned at all, despite pulling the trigger that enabled these transactions. Logical consistency would dictate that Ethereum as we know it should end as node operators have immutably absorbed and operate reckless machine gun firing wildly on the chain. In fact many of the people interacted with TC don't even have possession of the gun, rather they pay the 'hitman' the node operators to do it.
  - smsm42 4y ago
    Well, in this case the bullet analogy is imperfect, as in financial crimes like these there are more than one side which is violating the law. Probably a drug market would be a better analogy - in this case, all of the buyer, the seller and the market organizer are violating the laws (and there's no actual victim, but that's the topic for a different conversation). > Interestingly the node operators (the people ACTUALLY EXECUTING TC, even at this very moment) haven't been sanctioned at all Because the crime is not "executing TC", the crime is (certain) financial transactions. TC code is just the means by which it is executed, and the node operators do not intend to execute a specific financial transaction and do not specifically benefit from it. Just like, for example, if you are going to buy illegal drugs, and you send the payment for it via Venmo and then send the stash location using Gmail, Venmo and Google would not be liable for the drug transaction (even if Venmo charged a transaction fee) because for them it's just common transaction like any other. Same would go for node operators. > In fact many of the people interacted with TC don't even have possession of the gun It doesn't matter. What matters is who caused the illegal activity to happen. I mean, if you had a chain that is dedicated to money laundering or another illegal activity, and had no other uses whatsoever - it could actually earn OFAC designation probably by itself, as a whole, and then using it and running the node might become a crime. But I don't think OFAC intends to argue that's the case with Ethereum - it's pretty clearly not true, as most Ethereum users and nodes are perfectly happy to follow the law and never do anything illegal.

The argument is that the sanctions authority granted by Congress to Treasury is limited to persons and entities, and the Tornado Cash smart contracts are neither, nor the property of either.

woodruffw 4y ago

I think my response to 'yieldcrv addresses this. TL;DR: Nobody thinks that the Tornado Cash smart contracts are themselves persons. The government is clearly operating along the reasoning that a human being had to be (and was, in fact) in the loop as part of deploying the smart contracts. That brings us back to the initial analogy I used: you can't absolve yourself by building a robot that does the crime for you.

miracle2k 4y ago
> you can't absolve yourself by building a robot that does the crime for you. But the argument isn't at all about absolving the robot builder. In fact, they explicitly take no view on whether the sanctions against the Tornado Cash entity are justified. They also do not take a view on whether the government would be justified in prosecuting the individuals behind Tornado Cash. They are saying the government does not have the statutory authority to sanction the robot you built.
- woodruffw 4y ago
  That's not what they're saying. They're saying the government doesn't have the statutory authority to sanction the entity that built the robot. This is the entire point of their extended digression on the "Tornado Cash Entity" versus the "Tornado Cash Application." (Defending the TCE also continues below that, on a mostly irrelevant and unargued tangent about software IP.)
  - miracle2k 4y ago
    From the post: "So there is potentially an entity called Tornado Cash that is controlled by certain individuals, and the web address and some of the Ethereum addresses in the notice can be thought of as either pseudonyms for that entity or, alternatively, as its property. At this point, we’re not offering an opinion on whether it was appropriate to sanction that entity—we do not know all the facts that have led to this action—but we would agree that there may be an entity behind those donation addresses and that said entity may be legally eligible for listing. "
    - woodruffw 4y ago
      Yeah, I read that. The problem is that it just isn't compatible with the rest of the post: there are extended sections where they point out that the TCE can't be held responsible for the TCA, that even an IP-based case against the TCE would not apply, etc. etc. In short: they're trying to have it both ways, and it's not coming off well. If they had restricted their attention to just the TCA the argument would be more interesting, but ultimately still not compelling: everybody involved understands that there were some humans who decided to "pull the trigger" and deploy the TCA.

smsm42 4y ago

That's just playing semantic games. Like saying "well, the police only has authority over people, and a person didn't kill him - a bullet shot from a gun did!". Somebody was on the back end of that gun, and somebody deployed Tornado Cash. And the police can confiscate the gun and the bullets, and prosecute whoever shot it. The autonomous part here does not solve anything - it's only work if the whole system, ab initio, was autonomous without human intention - but even then the government could claim to regulate an access to it - just as it could, for example, restrict access to an erupting volcano if it wanted, even if no person caused it to erupt. But here it's much simpler because somebody definitely caused TC to operate, so the whole argument disappears.

woodruffw 4y ago
I just want to say: you beat me to using the bullet analogy! If you don't mind, I intend to link to this comment in a blog post.
notch656a 4y ago
The people that 'shot' the bullet though are either the node operators or the users of Tornado Cash. Interestingly the node operators (the people ACTUALLY EXECUTING TC, even at this very moment) haven't been sanctioned at all, despite pulling the trigger that enabled these transactions. Logical consistency would dictate that Ethereum as we know it should end as node operators have immutably absorbed and operate reckless machine gun firing wildly on the chain. In fact many of the people interacted with TC don't even have possession of the gun, rather they pay the 'hitman' the node operators to do it.
- smsm42 4y ago
  Well, in this case the bullet analogy is imperfect, as in financial crimes like these there are more than one side which is violating the law. Probably a drug market would be a better analogy - in this case, all of the buyer, the seller and the market organizer are violating the laws (and there's no actual victim, but that's the topic for a different conversation). > Interestingly the node operators (the people ACTUALLY EXECUTING TC, even at this very moment) haven't been sanctioned at all Because the crime is not "executing TC", the crime is (certain) financial transactions. TC code is just the means by which it is executed, and the node operators do not intend to execute a specific financial transaction and do not specifically benefit from it. Just like, for example, if you are going to buy illegal drugs, and you send the payment for it via Venmo and then send the stash location using Gmail, Venmo and Google would not be liable for the drug transaction (even if Venmo charged a transaction fee) because for them it's just common transaction like any other. Same would go for node operators. > In fact many of the people interacted with TC don't even have possession of the gun It doesn't matter. What matters is who caused the illegal activity to happen. I mean, if you had a chain that is dedicated to money laundering or another illegal activity, and had no other uses whatsoever - it could actually earn OFAC designation probably by itself, as a whole, and then using it and running the node might become a crime. But I don't think OFAC intends to argue that's the case with Ethereum - it's pretty clearly not true, as most Ethereum users and nodes are perfectly happy to follow the law and never do anything illegal.